The House and Senate versions of the state budget for the 2024-25 biennium, House Bill 1 and Senate Bill 1, were filed on Jan. 18. These introduced bills, also known as baseline budget bills, are the starting point for budget deliberations. While the budget-writing committees – House Appropriations and Senate Finance – hold hearings simultaneously, the chambers take turns originating the general appropriations act and chairing the budget conference committee.
For the 88th legislative session, the state budget will originate in the House; therefore the final version of the bill will be HB 1. Senate Finance Committee members have been announced, with the House expected to announce its committee assignments soon. Senate Finance has scheduled hearings beginning next week.
Baseline budget bill highlights:
- HB 1 and SB 1 are remarkably similar, appropriating roughly $289 billion in all funds and $136.4 billion in general revenue and general revenue-dedicated (GR) funds. Compared with 2022-23 estimated expenditures, this represents a decrease of $8.5 billion or 2.9% in all funds and an increase of $11.5 billion or 9.2% in GR spending. The overall $8.5 billion decrease is due mainly to the depletion of federal COVID-19 stimulus funds, a $31 billion decline.
- Both bills are well below the constitutional and statutory spending limits (see table below). Budget writers may transfer GR to dedicated funds not subject to the caps to work around the spending limits. Also, any GR spending authorized by the supplemental appropriations bill for the current two-year budget increases two of the three spending limits.
|Remaining GR Spending Capacity Compared With Spending Caps
||Billions of dollars
||Votes required to override cap
||Four-fifths vote in both chambers
|Tax Spending Limit
||Simple majority vote in both chambers
|Consolidated GR Limit
||Three-fifths vote in both chambers
|Source: Legislative Budget Board
HB 1/SB 1 funding that impacts counties:
- A $350 million appropriation contingent on legislation for a new county law enforcement grant program for rural Texas communities. Grants would be administered by the Comptroller of Public Accounts, with eligible uses of funds to be determined by legislation.
- Adult probation departments – $112.5 million to fund salary increases (5% per year) at local departments, and funding increases for basic supervision, offender treatment and supervision.
- Juvenile probation departments (JPDs) – $51.4 million for salary increases (5% per year) for local JPD staff; $60.4 million to base the funding methodology for JPDs on individual referrals; and $22 million to increase local capacity for pre-adjudication and post-adjudication. Also, the bills include $200 million to construct two new secure state juvenile facilities with mental health capacity.
- Border security – $100 million for grants to local entities for Operation Lone Star and $125 million to the Texas Division of Emergency Management to create a new border processing center.
- Indigent defense grants – $113.2 million, down from the $136.8 million the Legislative Budget Board reports for indigent defense spending in the current two-year budget. The 2022-23 amount includes $13.9 million in American Rescue Plan funds and $31.7 million in Operation Lone Star grants for indigent legal counsel and foreign language interpreters for court appearances.
- Courthouse preservation grants – $1.2 million, significantly down from the $32.9 million in GR and rainy day fund spending in the 2022-23 biennium.
- Selected behavioral health funding items:
- $252 million to maintain state hospital capacity and an additional 234 contracted inpatient psychiatric beds: 85 beds in rural areas and 149 beds in urban areas.
- $80 million for grants to reduce recidivism, arrest and incarceration of justice-involved individuals with mental health issues, and to reduce wait times for forensic commitments, a $30 million increase from current funding levels.
- $59 million to contract for an additional 150 competency restoration beds.
- $36 million for six additional crisis stabilization units to provide short-term alternatives to hospital admission.
Supplemental budget bill
Finally, the baseline bills include an intent rider listing what budget writers propose to include in the supplemental bill for the 2022-23 budget. Two items of interest for counties:
- A proposed $2.4 billion for state hospital construction, including a new state mental health hospital for the Panhandle region.
- A proposed $400 million in additional funding for flood mitigation projects.
For a detailed breakdown of funding in the baseline bills for counties, see this updated State Budget Worksheet.
Please contact Zelma Smith for more information on the state budget.